How to Avoid Probate in Tennessee?

Probate doesn’t have to be part of your family’s future. This legal process of validating a will and distributing assets can be time-consuming, expensive, and invasive.

Fortunately, there are methods you can take to bypass probate, simplifying the process and keeping it private for your loved ones.

In Tennessee, these methods include creating a Revocable Living Trust, using beneficiary designations, establishing joint ownership with rights of survivorship, setting up Payable-on-death (POD) accounts, using Transfer-on-death (TOD) deeds, gifting assets during your lifetime, and relying on a Small Estate Affidavit for smaller estates.

Seven Ways to Avoid Probate in Tennessee

There’s no one-size-fits-all approach here. Instead, you can use one or a combination of methods depending on your goals, assets, and family situation.

1. Create a Revocable Living Trust

A Revocable Living Trust is one of the most powerful tools for avoiding probate. It allows you to manage your assets during your lifetime and specify how they’ll be distributed after your death.

Here’s how it works:

• As the initial trustee, you manage your assets while you’re alive and mentally capable.
• You can modify or revoke the trust anytime.
• After your death, the person you’ve chosen as your successor trustee takes over to distribute the assets per your instructions.

Benefits of a Revocable Living Trust include:

• Assets bypassing probate entirely, saving time and money.
• The trust providing privacy since it doesn’t become a public record.
• You control the timing and method of distribution, even protecting assets for minor or vulnerable beneficiaries.

2. Utilize Beneficiary Designations

Many types of accounts allow you to name beneficiaries who inherit the funds directly, skipping probate. These include:

• Retirement accounts like 401(k)s and IRAs.
• Life insurance policies.
• Payable-on-death (POD) and Transfer-on-death (TOD) accounts.

It’s simple: upon your passing, these assets go straight to the named individuals, avoiding probate entirely.

Just remember to review and update your beneficiary designations regularly. Changes in your life like marriages, divorces, or the birth of children might mean it’s time to revise your choices.

3. Joint Ownership with Rights of Survivorship

Owning property jointly with someone else is another way to bypass probate. In Tennessee, if you own an asset with rights of survivorship, it automatically passes to the surviving owner upon your death.

This approach works well for:

• Real estate
• Bank accounts
• Certain financial assets

Potential drawbacks include:

• Adding a joint owner means sharing control. They’ll have equal rights to the asset, which could cause conflicts.
• Assets held in joint ownership could become vulnerable to the co-owner’s creditors, potentially putting the property at risk.
• This method isn’t ideal for everything—personal items or valuable collections might require a different approach.

4. Payable-on-death (POD) Accounts

Payable-on-death (POD) accounts are a simple and affordable way to ensure your bank accounts and certificates of deposit go directly to your chosen beneficiaries after you pass away—without going through probate.

Here’s how they work:

You designate a beneficiary for your account, and upon your death, the funds transfer directly to them. Since the transfer happens automatically and outside the probate process, it’s both efficient and hassle-free for your loved ones.

5. Transfer-on-death (TOD) Deeds

Transfer-on-death (TOD) deeds allow real estate to pass directly to a designated beneficiary upon your death, avoiding probate entirely. Ownership remains with you during your lifetime, and the transfer takes effect only after your passing.

To be valid in Tennessee, TOD deeds must be properly prepared and recorded. While this method works well for many, it may not suit situations with outstanding mortgages or multiple heirs.

Beneficiaries also take on full ownership, including taxes or debts tied to the property. TOD deeds offer a straightforward way to transfer real estate while maintaining control during your lifetime.

6. Gifting Assets During Your Lifetime

Giving assets away while you’re alive reduces the size of your estate, which can help avoid probate for those items. The annual gift tax exclusion allows you to give up to $18,000 per recipient in 2024 without paying gift taxes.

Be mindful of how gifting fits into your overall estate plan. Large gifts could have tax implications and might limit the resources you need later in life.

7. Use a Small Estate Affidavit

For Tennessee estates valued at $50,000 or less, a Small Estate Affidavit provides a faster, simpler way to transfer assets to heirs without full probate. This method works best for smaller estates with no real estate unless it qualifies for simplified transfers.

To qualify, the estate must meet the value limit and the affidavit must be filed with the court. There’s often a short waiting period before assets can be claimed.

This process reduces costs, paperwork, and delays, offering families a quicker, less stressful option for settling small, straightforward estates.

Five Reasons to Avoid Probate in Tennessee

Why take these steps? Avoiding probate isn’t just about convenience—it’s about protecting your family and your legacy.

1. Save on costs and legal fees. Probate can be expensive and those costs come out of your estate.
2. Protect your privacy. Probate filings are public, meaning anyone can see your financial details.
3. Speed up inheritance. Probate can take months or even years to complete, delaying asset distribution.
4. Reduce family disputes. Clear plans can minimize conflicts among heirs.
5. Ease the burden on loved ones. Avoiding probate simplifies the process during an already emotional time.

Ready to Simplify Estate Planning? Contact Foust & Foust, PLLC

Planning ahead is the best gift you can give your loved ones. At Foust & Foust, PLLC, we’re here to help you craft an estate plan that works for your family.

Whether it’s setting up a trust, reviewing beneficiary designations, or exploring other probate-avoidance strategies, we’ve got the experience to make it happen.

Let’s get started—contact us today to schedule a consultation and take the first step toward peace of mind for you and your family.